The U.S. Postal Service used its “professional judgment” in predicting massive financial losses as a result of the pandemic that in reality never played out as dramatically as the mailing agency had expected, a watchdog has found.
The processes USPS used to make its calculations were inherently ad hoc and based on assumptions with little historic precedent, the agency’s inspector general found in a report on Wednesday. That led postal management to forecast precipitous declines in mail and package volume and corresponding calamitous drops in revenue. To date, however, USPS has earned more revenue than the same period before the COVID-19 pandemic began.
The better-than-expected results were driven in large part by skyrocketing package business as ecommerce sales grew while Americans remained at home, though regular mail volume has not declined as much as management had anticipated. Mail volume was down 27% in April 2020 compared to April 2019, but the declines were less severe in the months that followed. At the outset of the pandemic, the Postal Service projected its fiscal 2020 revenue could dip to as low as $67 billion. In reality, it took in more than $73 billion.